Echo owners spend on average $1,700 per year on Amazon vs. $1,300 for Prime members.

Based on a survey of 2,000 consumers who made purchases on Amazon.com in 2017, Consumer Intelligence Research Partners (CIRP) has determined that Amazon Echo owners are even more valuable to the company than Prime members.

CIRP grouped Amazon shoppers into three categories: (1) those that own at least one Alexa device, (2) Prime subscribers and (3) average Amazon shoppers who don’t fall into either of the other two categories. (There’s probably a meaningful overlap between categories 1 and 2.)

The company estimated that average annual spending for all Amazon customers is $1,000 while Prime subscribers spend roughly $1,300. However, Echo owners spent a full $400 more on average, coming in at around $1,700 annually.

Average Annual Spending on Amazon.com (As of Q3 2017)

Amazon aggressively discounted the cost of its various Alexa devices in an effort to drive adoption and consolidate its dominant position in the virtual assistant market. Alexa/Echo devices were at or near the top of the company’s list of best-selling electronics over the holiday.

Most of these Echo owners are not buying products by voice. Echo ownership thus reflects (and perhaps reinforces) loyalty to Amazon. Recognizing the spending patterns, Amazon may be inclined to subsidize Echo devices to get them into people’s homes. This was one of the speculative observations in the CIRP report.

Estimates in the market of Prime membership vary from about 50+ million to just over 100 million. It’s probably closer to the latter figure. It’s also a safe bet that the categories of Echo owners and Prime members substantially overlap.

There are about 125 million US households, according to US Census Data and updated estimates. Many virtual assistant households have more than one device (think: multiple rooms). Accordingly, the US market for virtual assistants could ultimately exceed 200 million devices.

About The Author

Greg Sterling is a Contributing Editor at Search Engine Land. He writes a personal blog, Screenwerk, about connecting the dots between digital media and real-world consumer behavior. He is also VP of Strategy and Insights for the Local Search Association. Follow him on Twitter or find him at Google+.